Garsia v. Burch — 57 N.Y. St. Rep. 532

Majority

p. 532

Alfred C. Garsia, App’lt, v. T. Hamilton Burch, Resp’t.

(New York Common Pleas, General Term,

Filed February 5, 1894.)

Headnote

1. Co-partnership—Individual Debts.

Where one partner uses or disposes of firm assets in payment of his indi, vidual debts, with the assent of the co-partner or his duly authorized agent, the co-partner is bound by such arrangement.

2. Same.

A party who, at the time of his transactions, was not aware that the wives, and not the hnsbands, compose the firm, but to whom the latter were held out as the partners, has the right to treat them as members of the firm.

3. Principal and Agent—Declarations.

The acts and declarations of a general agent, in the transaction of his principal’s business, though in his absence, bind him.

Appeal from a judgment entered in the district court of the city of New York for the sixth judicial district in favor of the defendant, dismissing the complaint.

James W. Hawes, for appl’f; Fromme Brothers, for resp’t.

The plaintiff sues as purchaser of claims at a sale by the assignee of the firm of Brown & Plympton, which firm was composed of Martha A. Brown and Emma C. Plympton, but the business was carried on by their respective husbands. It is established beyond any question that the defendant performed professional services as a physician for Mr. Plympton for more than the amount of the claim sued for. It also appeared from the evidence that there was a continuing arrangement by which the claim against him was from" time to time offset against his claim for services; that this arrangement was known to and acquiesced in if not suggested by Mr. Brown, the husband of Martha A. Brown, who acted as her general attorney in conducting the business of the firm. It is, of course, true as contended by appellant’s counsel that one partner has no right to use or dispose of co-partnership assets in payment of his individual debts, but if this is done with the assent of the co-partner or one authorized

p. 533

to .carry on the business on behalf of the co-partner, that partner cannot subsequently take advantage of this rule. It is manifest if Mrs. Brown herself had consented to this arrangement, she could not afterwards have questioned it, and we think that her husband carrying on the business for her and having general authority as he had, to sell, dispose of, collect and discharge liabilities, had as much right as she to agree to such an arrangement. It is only where an agreement of the kind between Plympton and the defendant was made without the knowledge or assent of the other party, that it would not be binding upon the firm ; whether or not such assent was given must depend upon the facts and circumstances of each case. Gates et al. v. Vincent, 12 N. Y. Supp. 704 ; 34 St. Rep., 800 . Besides this, the defendant at the time he rendered the services to Plympton and purchased the goods in question, was not aware that the wives and not the husbands composed the firm, but the latter were held out to him as composing that firm. Under such circumstances he had a right to treat with them as principals; Mullen v. Lamphear, 15 St. Rep., 647 , and cases cited. Or at least to believe that they were acting within the scope of their authority, as there was nothing to indicate to the public at large that any but the husbands were the actual co-partners in the business. Ruggles v. Am. Ins. Co., 114 N. Y., 415 ; 23 St. Rep., 847 ; Wait v. Borne, 123 N. Y., 592 ; 34 St. Rep., 344 .

The objection to the introduction of what took place between Mr. and Mrs. Plympton and Mr. Brown when Mrs. Brown was not present, is not well taken. Mr. Brown y^as there as her general agent and representative, and had a right to act and speak for her.

It may be that some of the interrogatories propounded to the witnesses examined on commission, did call for conclusions, and would have been stricken out by the court if there had been a settlement of interrogatories before the commission issued. We do not think, however, that the answers to these interrogatories could have in any way affected the result, and that the judgment should be reversed on these grounds.

The judgment is, therefore, affirmed, with costs to the respondent.

This conclusion is reached with less hesitation because it appears from the bill of sale to plaintiff that he purchased this claim with others aggregating a considerable sum, for seven dollars and with a distinct notice in the bill of sale itself that the assignee did not represent such claims to be uncollected, and that all of them “were sold subject to any and all defenses which might be interposed or set up,” which was quite sufficient to put him on inquiry before making the purchase.